Homeowner’s insurance — always grateful to have it, and yet always confused on what is actually covered!
More often than not, the situation goes like this: your lender requires insurance and you hurriedly made a decision without truly comparing different policies, and likely not looking at additional endorsements or riders. Did you just decide to bundle policies with the insurance company you got your car insurance through 10 years ago?
Choosing the right insurance policy can feel overwhelming, but don’t panic. If you’re shopping for homeowner’s insurance or thinking about reviewing your current policy, here are some things you should keep in mind:
➊ Check the limits on your personal property and liability coverage. Your belongings (such as clothing, furniture, electronics, etc.) are insured under personal property coverage. Take inventory and make sure the limit is enough to cover everything you own. Personal liability coverage protects you if you’re liable for an incident that injures someone on your property, so be sure to select a liability limit that properly covers what you have in assets.
➋ Be aware of exclusions. Depending on where you live, there will be a list of things that won’t be covered by a standard policy. This includes earthquakes, landslides, and flooding. Be sure to ask your insurance agent if there’s an option to purchase protection for excluded incidents.
Other additional coverage and endorsements include water backup (water line, sewer line coverage), equipment breakdown, and home business.
➌ Understand your deductibles! When buying home insurance for the first time, it’s important to pay attention to your deductibles for property damage. Your deductible is the portion of the claim you’re responsible for, so make sure the deductible amount is within your budget. For example, you may not want to elect the policy with a lower monthly premium that requires a $5,000 deductible, because anything under $5,000 is going to come out of your pocket.
➍ Check for additional coverages that may be available, such as personal property endorsements for valuable items like jewelry or electronics. You may also want to consider identity theft protection or coverage for other detached structures on your property.
Most people are not fully aware of what they are covered for until they need it. Don’t let that happen to you! Peace of mind starts with the right coverage.
Let me know if you need a great insurance agent — I have amazing connections and it would be worth a checkup.